Sources: Multimodal AI startup Fal.ai has already raised a valuation of over $4 billion

Fal.ai, a startup that hosts image, video and audio AI models for developers, has closed a new round valuing the company at more than $4 billion, four people familiar with the matter said. The company has raised about $250 million, two of the people said.

The main investors in the round are Kleiner Perkins and Sequoia, according to our sources. Fal did not respond to a request for comment. Sequoia and Kleiner Perkins declined to comment.

The new funding round comes less than three months after Fal announced a $125 million Series C round valued at $1.5 billion, led by Meritech. At that time, the company’s revenue exceeded $95 million and its platform was used by more than two million developers, Todd Jackson, a partner at First Round Capital, wrote on LinkedIn. This is massive growth from last year, when TechCrunch reported that Fal had $10 million in annualized recurring revenue (ARR) and 500,000 developers.

Since Fal provides the infrastructure layer for multi-modal AI models (as well as media-specific ones), the company’s explosive growth is directly tied to user adoption of applications built on top of it. And multimodal AI is currently in high demand, especially video, as evidenced by the growing popularity of OpenAI’s Sora, which reached the top of the US App Store even faster than ChatGPT. This massive consumer demand for apps like Sora highlights the commercial potential of Fal’s offering.

Fal provides developers with more than 600 image, video, audio and 3D models, it claims, and boasts that its cloud has thousands of Nvidia H100 and H200 GPUs and is optimized for fast inference. It also offers tools to customize templates. Its offerings include access via API, hosted via a flexible serverless offering or via enterprise-ready compute clusters. While there are certainly other competitors offering model and application hosting services (Microsoft, Google,
CoreWeave, to name a few), Fal’s focus on media and multimodal is its competitive selling point, venture capitalists like Jackson say.

The startup’s customers range from individual developers to large enterprises, including Adobe, Canva, Perplexity and Shopify. Some of the most common use cases include creating media for advertising, e-commerce, and gaming content.

The startup was co-founded in 2021 by Burkay Gur, former Coinbase machine learning leader and Oracle engineer, and Gorkem Yurtseven, who was previously a developer at Amazon. Gur and Yurtseven saw an opportunity for personalized media generation. As other technologists continued their research into LLMs, they focused on optimizing stable delivery in terms of speed and scale, and have since expanded to host many more such models.

Fal had already raised nearly $200 million, according to PitchBook data. The company’s existing investors include Bessemer Venture Partners, Kindred Ventures, Andreessen Horowitz, Notable Capital, First Round Capital, Unusual Ventures and Village Global.